UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
SCHEDULE 14D-9
SOLICITATION/RECOMMENDATION STATEMENT
UNDER SECTION 14(d)(4) OF THE SECURITIES EXCHANGE ACT OF
1934
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INVENTRUST PROPERTIES CORP. |
(Name of Subject Company)
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INVENTRUST PROPERTIES CORP. |
(Names of Persons Filing Statement)
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COMMON STOCK, PAR VALUE $0.001 PER SHARE |
(Title of Class of Securities)
(CUSIP Number of Class of Securities)
Christy L. David
Executive Vice President, Chief Investment Officer, General Counsel
& Secretary
InvenTrust Properties Corp.
3025 Highland Parkway, Suite 350
Downers Grove, Illinois 60515
(855) 377-0510
(Name, address and telephone number of person authorized to receive
notices and communications
on behalf of the persons filing statement)
Check the box if the filing relates solely to preliminary
communications made before the commencement of a tender
offer.
INTRODUCTION
This Solicitation/Recommendation Statement relates to a tender
offer (the “Tender Offer”) by Comrit Investments1, LP, (the
“Offeror”) to purchase up to 2,450,980 shares of the outstanding
common stock, par value $0.001 per share (the “Common Stock”), of
InvenTrust Properties Corp., a Maryland corporation (the
“Company”), at a price equal to $1.02 per share (the “Offer
Price”), upon the terms and subject to the conditions set forth in
the Offer to Purchase that, to the Company’s knowledge, the Offeror
caused to be disseminated to the Company’s stockholders on or about
January 13, 2021 (the “Offer to Purchase”). To the Company’s
knowledge, the Offeror has not filed with the SEC a Schedule TO
containing the Offer to Purchase.
As discussed below, the executive committee of the board of
directors of the Company (the “Board”) unanimously recommends that
the Company’s stockholders (the “Stockholders”) reject the Tender
Offer and not tender their shares of Common Stock for purchase
pursuant to the Offer to Purchase.
Item 1.Subject
Company Information.
The Company’s name and the address and telephone number of its
principal executive office is as follows:
InvenTrust Properties Corp.
3025 Highland Parkway, Suite 350
Downers Grove, Illinois 60515
(855) 377-0510
This Schedule 14D-9 relates to the Common Stock, of which there
were 720,829,133 shares outstanding as of January 4,
2021.
Item 2.Identity
and Background of Filing Person.
The Company is the person filing this Schedule 14D-9. The Company’s
name, business address and business telephone number are set forth
in Item 1 above, which information is incorporated herein by
reference.
This Schedule 14D-9 relates to the Tender Offer by the Offeror
pursuant to which the Offeror has offered to purchase, subject to
certain terms and conditions, up to 2,450,980 shares of Common
Stock at the Offer Price pursuant to its Offer to Purchase. Unless
the Tender Offer is extended by the Offeror, the Tender Offer will
expire at 11:59 p.m., Eastern Time, on February 20,
2021.
According to the Offer to Purchase, the business address and
telephone number for the Offeror is 9 A’had Ha’am St., Tel Aviv,
P.O.B 29161, 61291, Israel, + 972-3-519-9936.
Item 3.Past
Contacts, Transactions, Negotiations and Agreements.
As of the date of this Schedule 14D-9, there are no material
agreements, arrangements or understandings or any actual or
potential conflicts of interest: (i) between the Company or its
affiliates and the Offeror and their respective executive officers,
directors or affiliates; or (ii) between the Company or its
affiliates and the executive officers, directors or affiliates of
the Company, except for agreements, arrangements or understandings
and actual or potential conflicts of interest discussed in the
sections captioned as follows, all of which are incorporated herein
by reference: (A) “Note 14 – Stock-Based Compensation” in the
financial statements and “Item 12 – Security Ownership of Certain
Beneficial Owners and Management and Related Stockholder Matters,”
both contained in the Company’s Annual Report on Form 10-K filed
with the SEC on February 21, 2020; and (B) “Corporate Governance
Principles,” “Proposal No. 1 – Election of Directors” and
“Executive Compensation” in the Company’s Definitive Proxy
Statement on Schedule 14A filed with the SEC on March 6,
2020.
Item 4.The
Solicitation or Recommendation.
a.Solicitation
or Recommendation.
The Board has reviewed the terms of the Tender Offer.
Based on its review, the Board unanimously recommends that
Stockholders reject the Tender Offer and not tender their shares
for purchase by the Offeror pursuant to the Offer to
Purchase.
The Board cautions that each Stockholder must individually evaluate
whether to tender his, her or its shares of Common Stock to the
Offeror pursuant to the Offer to Purchase and that an individual
Stockholder may determine whether to tender based on, among other
things, his, her or its individual liquidity needs. The Board
acknowledges that, because the Common Stock is not listed on an
exchange and there is not otherwise an established public trading
market for the Common Stock, Stockholders currently have few
alternatives available to sell some of or all their Common
Stock.
The Board suggests Stockholders carefully consider all the factors
discussed below and in the Offer to Purchase before deciding to
participate in the Tender Offer.
b.Reasons
for the Recommendation.
In reaching the conclusions and in making the recommendation
described above, the Board considered the following factors based
on its review of the Offer to Purchase in evaluating the merits of
the Tender Offer and in support of its recommendation that
Stockholders reject the Tender Offer and not tender their shares in
the Tender Offer:
•On
December 21, 2020, the Company announced an estimated value per
share of the Common Stock equal to $2.89 per share as of December
1, 2020, $1.87 per share (or approximately 283%) above the Offer
Price. As previously disclosed to Stockholders, the estimate is
based on certain assumptions and subject to certain limitations all
discussed in the Company’s Current Report on Form 8-K filed with
the SEC on December 21, 2020.
•The
Company’s annual distribution rate was $0.0759 per share of Common
Stock as of the last quarterly distribution on October 15, 2020
payable to all Stockholders of record as of September 30, 2020.
Although the Board cannot provide any guarantee that the Company
will maintain distributions at any rate in the future, Stockholders
who choose to participate in the Tender Offer by selling their
shares to the Offeror will lose all rights attendant to the shares
including the right to receive all future distributions, including
any distributions made or declared after the expiration date of the
Tender Offer.
•The
Offeror states that it has not made an independent appraisal of the
shares or the Company’s properties and is not qualified to appraise
real estate.
•The
Offeror acknowledges that in establishing the purchase price of
$1.02 per share, it intends to make a profit and is motivated to
establish the lowest price which might be acceptable to
stockholders consistent with that profit-seeking
intention.
•There
is no guarantee that the Tender Offer can or will be completed as
soon as the Offeror implies. The Tender Offer does not expire until
February 20, 2021 at the earliest. This date may be extended by the
Offeror in its sole discretion. In addition, if more than 2,450,980
shares of Common Stock are validly tendered in the Tender Offer and
not withdrawn, the Offeror will accept shares of Common Stock from
tendering Stockholders on a pro rata basis.
•The
Offeror attempts to force any dispute that may arise between a
stockholder and any other party relating to the Tender Offer into
binding arbitration in Denver, Colorado. This attempt to
enforce
binding arbitration, if not successfully challenged in a court of
competent jurisdiction, may deprive a stockholder of its right to a
jury trial in a forum convenient to the stockholder.
•The
Offeror expressly reserves the right to amend the terms of the
Tender Offer, including by increasing or decreasing the Offer Price
or by changing the number of shares being sought or the type of
consideration, at any time before it expires. Although any
amendment will be followed by a public announcement, the Offeror
does not have an obligation to otherwise communicate that amendment
to Stockholders.
c.Intent
to Tender.
The Company’s directors and executive officers are entitled to
participate in the Tender Offer on the same basis as other
Stockholders. However, after reasonable inquiry and to the best
knowledge of the Company, none of the directors or executive
officers of the Company intends to tender or sell shares of Common
Stock held of record or beneficially by such person for purchase
pursuant to the Tender Offer. Further, after reasonable inquiry and
to the best knowledge of the Company, none of the Company’s
subsidiaries or other affiliates intends to tender or sell shares
of Common Stock held of record or beneficially by such person or
entity for purchase pursuant to the Tender Offer.
Item 5.Person/Assets,
Retained, Employed, Compensated or Used.
Neither the Company nor any person acting on its behalf has
employed, retained or agreed to compensate any person to make
solicitations or recommendations to Stockholders concerning the
Tender Offer.
Item 6.Interest
in Securities of the Subject Company.
Based on the Company’s records and on information provided to the
Company by its directors, executive officers, affiliates and
subsidiaries, during the past 60 days, no transactions with respect
to the Common Stock have been effected by the Company, its
executive officers, directors, affiliates or
subsidiaries.
Item 7.Purposes
of the Transaction and Plans or Proposals.
The Company has not undertaken and is not engaged in any
negotiations in response to the Tender Offer that relate to: (i) a
tender offer or other acquisition of the Company’s securities by
the Company, any of its subsidiaries or any other person; (ii) an
extraordinary transaction, such as a merger, reorganization or
liquidation involving the Company or any of its subsidiaries; (iii)
a purchase, sale or transfer of a material amount of assets of the
Company or any of its subsidiaries; or (iv) any material change in
the present distribution rate or policy, or indebtedness or
capitalization of the Company.
Additionally, there is no transaction, board resolution, agreement
in principle, or signed contract in response to the Tender Offer
which relates to or would result in one or more of the foregoing
matters.
Item 8.Additional
Information.
a.Golden
Parachute Compensation.
There are no agreements or understandings, whether written or
unwritten, between any named executive officer of the Company and
the Company or the Offeror concerning any type of compensation,
whether present, deferred or contingent, that is based upon or
otherwise relates to the Offer to Purchase.
b.Other
Material Information.
Certain statements contained in this Schedule 14D-9 other than
historical facts may be considered forward-looking statements.
These statements include statements about the Company’s plans,
objectives, strategies, financial
performance and outlook, trends, the amount and timing of future
cash distributions, prospects or future events and involve known
and unknown risks that are difficult to predict. As a result, the
Company’s actual financial results, performance, achievements or
prospects may differ materially from those expressed or implied by
these forward-looking statements. In some cases, you can identify
forward-looking statements by the use of words such as “may,”
“could,” “expect,” “intend,” “plan,” “seek,” “anticipate,”
“believe,” “estimate,” “guidance,” “predict,” “potential,”
“continue,” “likely,” “will,” “would,” “illustrative” and
variations of these terms and similar expressions, or the negatives
of these terms or similar expressions. Such forward-looking
statements are necessarily based upon estimates and assumptions
that, while considered reasonable by the Company based on the
Company’s knowledge and understanding of the business and industry,
are inherently uncertain. These statements are not guarantees of
future performance, and Stockholders should not place undue
reliance on forward-looking statements.
There are a number of risks, uncertainties and other important
factors, many of which are beyond the Company’s control, that could
cause its actual results to differ materially from the
forward-looking statements contained in this Schedule 14D-9. Such
risks, uncertainties and other important factors include, among
others, the risks, uncertainties and factors set forth in the
Company’s filings with the SEC, including in the Annual Report on
Form 10-K for the year ended December 31, 2019, as may be updated
by the quarterly reports and current reports of the Company filed
with the SEC. Such risks and uncertainties, among others, include
market, political and economic volatility experienced by the U.S.
economy or real estate industry as a whole, and the regional and
local political and economic conditions in the markets in which the
Company’s properties are located; the Company’s ability to complete
a strategic transaction, enhance Stockholder value and provide
liquidity to Stockholders; the Company’s ability to identify,
execute and complete disposition opportunities; the Company’s
ability to identify, execute and complete acquisition opportunities
and to integrate and successfully operate any properties acquired
in the future and the risks associated with such properties; the
Company’s ability to manage the risks of expanding, developing or
re-developing some of the Company’s current or future acquired
assets; the Company’s transition to an integrated operating
platform not achieving success; loss of members of the Company’s
senior management team or key personnel; changes in governmental
regulations and United States accounting standards or
interpretations thereof; the Company’s ability to access capital
for renovations and acquisitions on terms and at times that are
acceptable to the Company; changes in the competitive environment
in the leasing market and any other market in which the Company
operates; shifts in consumer retail shopping from brick and mortar
stores to e-commerce; declaration of bankruptcy by the Company’s
retail tenants; forthcoming expirations of certain leases and the
Company’s ability to re-lease such properties; the Company’s
ability to collect rent from tenants or to rent space on favorable
terms or at all; the impact of leasing and capital expenditures to
improve the Company’s properties in order to retain and attract
tenants; events beyond the Company’s control, such as war,
terrorist attacks, natural disasters and severe weather incidents,
and any uninsured or underinsured loss resulting therefrom; actions
or failures by the Company’s joint venture partners, including
development partners; the cost of compliance with and liabilities
under environmental, health and safety laws; changes in real estate
and zoning laws and increases in real property tax rates; the
economic success and viability of the Company’s anchor retail
tenants; the Company’s debt financing, including risk of default,
loss and other restrictions placed on the Company; the Company’s
ability to refinance maturing debt or to obtain new financing on
attractive terms; future increases in interest rates; the
availability of cash flow from operating activities to fund
distributions; the Company’s investments in equity and debt
securities; the Company’s status as a real estate investment trust
(“REIT”) for federal tax purposes; changes in federal, state or
local tax law, including legislative, administrative, regulatory or
other actions affecting REITs; and the impact of changes in the tax
code as a result of recent U.S federal income tax reform and
uncertainty as to how some of those changes may be
applied.
The Company undertakes no obligation to update or revise
forward-looking statements to reflect changed assumptions, the
occurrence of unanticipated events or changes to future operating
results, except as may be required by applicable law.
Item 9. Exhibits.
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Exhibit No. |
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(a)(1) |
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(e)(1) |
Excerpts from the Company’s Annual Report on Form 10-K filed with
the SEC on February 21, 2020.* |
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(e)(2) |
Excerpts from the Company’s Definitive Proxy Statement
on Schedule 14A filed with the SEC on March 6,
2020.*
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(e)(3) |
Excerpts from the Company’s Current Report on Form 8-K filed with
the SEC on October 15, 2020.*
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(e)(4) |
Excerpts from the Company’s Current Report on Form 8-K filed with
the SEC on December 21, 2020.* |
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* Incorporated by reference as provided in Item 3
hereto.
SIGNATURE
After due inquiry and to the best of my knowledge and belief, I
certify that the information set forth in this statement is true,
complete and correct.
/s/ Christy L.
David
(Signature)
Christy L.
David
E.V.P., Chief Investment Officer, General Counsel &
Sec.
(Name and Title)
January 13,
2021
(Date)
Inventrust Properties (GM) (USOTC:IARE)
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